Onboard wstETH to Aave V3 on BNB Chain
Vote Result: YES
Rationale
This is the on-chain proposal for this Snapshot ARFC that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this proposal as well.
GHO Steward v2 Upgrade
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot ARFC that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this proposal as well.
[TEMP CHECK] Deploy GHO Facilitator
Vote Result: YES
Rationale
Given that GHO’s growth on Arbitrum has stalled, lowering the borrow rate by minting and depositing 5M GHO into the reserve and encouraging further GHO borrows is a positive action. Creating a separate GHO Facilitator is also a good move to reduce risk from the main facilitator. Therefore, we will vote YES in favour of this proposal.
[ARFC] Framework for Instances and Friendly Forks
Vote Result: YES
Rationale
As per our comment, it can get confusing to assess these friendly forks and whitelabel instances on their own merits when they are presented as ‘one-off’ proposals. As we also mentioned, we would also like to see each such proposal follow a template, how they meet this framework, and outline any mitigating circumstances, to allow delegates to easily assess whether to approve or reject the proposal. Therefore, we will vote YES in favour of this proposal.
[TEMP CHECK] Add FBTC to Aave v3 Main Instance on Ethereum
Vote Result: YES
Rationale
The $480M in TVL, Chainlink integration, and addition to the diversity of BTC options available to users are reasons enough for us to want the risk providers to more closely assess fBTC in the ARFC stage. Therefore, we will vote YES in favour of this proposal.
Aave Generalized Risk Stewards (AGRS) Activation
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot ARFC that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this proposal as well.
GHO CCIP Integration Maintenance (CCIP v1.5 Upgrade)
Vote Result: YES
Rationale
Updating the token pools to ensure that the GHO CCIP integration remains functional during the migration to CCIP v1.5 is necessary. Given that the token pools are fully controlled by the Aave DAO, we understand the need for this AIP. Therefore, we will vote YES in favour of this proposal.
[TEMP CHECK] Aave Instances Strategy Shift
Vote Result: YES
Rationale
Segregating risk more cleanly in the Prime, Core, and Emergence instances is a necessary shift given the expanded functionality with Aave v3.2 and liquid e-mode. Having two liquid e-modes inside the Prime instance is more capital efficient and utilises liquidity better. The Emergence instance and the subsequent junior stkGHO tranche is also a necessary evolution - as the protocol has evolved, we know which assets are crucial to Aave’s revenue, but we also need to be cognizant of enabling long-tail assets on the protocol. However, the risk from these assets is greater, and segregating this risk is a good balance to achieve. It would be good to define how an asset can get ‘promoted’ to the Core instance and be eligible for borrowing other assets than GHO.
All in all, we are very much in favour of this proposal and will vote YES.
[TEMP CHECK] Add PAXG to Aave v3 Main Instance on Ethereum
Vote Result: YES
Rationale
PAXG is a well-known and regulated asset; it would be beneficial to assess the value (and risk) of adding this asset to Ethereum v3 in the ARFC stage. Therefore, we will vote YES in favour of this proposal.
Safety Module stkAAVE - Re-enable Rewards
Vote Result: YES
Rationale
Extending the AAVE emissions for stkAAVE holders is a good way of maintaining the AAVE supply sink. Therefore, we will vote YES in favour of this proposal.
Automated (Edge) AGRS Activation
Vote Result: YES
Rationale
Enabling this pilot of the AGRS + Edge system is an obvious first step and the Aave Lido market on Ethereum is a logical move to start with, given the need to maintain the WETH borrowing cost below Lido’s staking rewards. The adjustment of the borrow rate daily will be a paradigm shift for Aave and it will be interesting to see the results of this pilot.
PYUSD Reserve Configuration Update & Incentive Campaign
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot ARFC that we voted in favour of according to our rationale here. Therefore, we will vote YES in favour of this proposal as well.
wstETH Reserve Borrow Rate Update - Main Instance
Vote Result: YES
Rationale
Firstly, increasing the wETH borrow rate will be effective in removing liquidity incentives and allowing for the sustenance of market activity organically; moreover, the expected ezETH deposits will balance the increase in the borrow rate. Secondly, the decrease in the wstETH borrow rate will make wstETH borrowing more attractive and lead to more looping with rsETH, adding to the DAO’s revenue. Lastly, both risk providers are in favour of this proposal. Therefore, we will vote YES in favour of this proposal.
Onboard and Enable sUSDe liquid E-Mode on Aave v3 Mainnet and Lido Instances
Vote Result: YES
Rationale
Given the high utilization of sUSDe, and the capital efficiency and enhanced borrow capacity enabled by liquid e-mode, enabling it for sUSDe makes sense. We appreciate the discussion between LlamaRisk and Chaos Labs around the liquidation bonus. Approving a LB of 3% ultimately made sense given current market conditions and Chaos’ analysis which highlights the mitigating factors around the 3.8% dislocation in April 2024. In most situations, a LB of 3% should be enough and we should ideally change the LB to 4% if market conditions tend to be more risky.
Overall, we think this proposal is positive and we will therefore vote YES in favour.
Onboard rsETH to Aave V3 Ethereum
Vote Result: YES
Rationale
This is the on-chain vote for this Snapshot ARFC that we voted in favour of according to our rationale here. Moreover, according to BGD Labs, rsETH seems to have no significant issues with integration into Aave. Chaos Labs has also updated their recommendations in light of Aave v3.2. Therefore, we will vote YES in favour of this proposal.
[ARFC] Onboard AUSD to Aave V3 on Avalanche
Vote Result: ABSTAIN
Rationale
While we voted YES in favour of the TEMP CHECK because AUSD is a stablecoin with potential with $70M+ in TVL and $12M+ in daily DEX volume, and the 50+ institutions onboarded, the legal risks highlighted by LlamaRisk do bring up concerns. The lack of sufficient information in Agora’s documentation, the AUSD access controls being assigned to EOAs, and the seemingly limited upside for onboarding AUSD onto Avalanche v3 makes us wary.
As such, at this stage, we think it would be prudent for us to vote ABSTAIN on this proposal.
[ARFC] Deploy 10M GHO into Aave v3 Lido Instance
Vote Result: YES
Rationale
There are multiple reasons to support this proposal:
- The impending proposal to onboard sUSDe to the Lido instance, which will drive demand for stablecoins, meaning that an already-filled GHO supply would increase utilization quicker;
- Reinforcing wstETH as a safe, credible collateral for GHO;
- Increasing the LTV for wETH from 0%, which will drive borrow demand against wETH as collateral;
- The lack of risk since any uncollateralized GHO can also be deposited directly into Lido as supply, ensuring availability of GHO for borrowers at a moment’s notice;
- The $600k revenue opportunity for the DAO from this deposit.
We take LlamaRisk’s point around the minting and deployment of this 10M GHO in accordance with the supply caps and encourage this action.
All in all, we will vote YES in favour of this proposal.
[ARFC] Onboard GHO and Migrate Streams to Lido Instance
Vote Result: YES
Rationale
Onboarding GHO to Aave Lido v3, providing initial liquidity from the treasury, and using this treasury to pay service providers makes sense to us. The GHO will be able to earn a yield on these holdings. Moreover, both risk providers are in support of this proposal. Therefore, we will vote YES in favour of this proposal.
[TEMP CHECK] Aave V3 Deployment on the Spiderchain (Botanix Labs)
Vote Result: YES
Rationale
As we said in our response to the forum post, we are very much in favour of this proposal and will vote YES for the following reasons:
- Onboarding more ‘pure’ (i.e., decentralized) forms of BTC into the Aave ecosystem is necessary,
- Botanix has onboarded Tier 1 DeFi protocols already;
- Bringing more BTC holders to Aave will even further broaden the reach of the protocol by bringing in a differentiated user base;
- Integrating GHO is at the core of the proposal and amplifies the core KPI the Aave ecosystem should be targeting: higher GHO borrow volume;
- $20M in BTC commitments to Aave upon mainnet launch;
- Availability of Chainlink feeds on Day 1, which is even more crucial in this case.
[ARFC] Enable cbBTC/WBTC Liquid E-Mode on Aave v3 Mainnet
Vote Result: YES
Rationale
Increasing capital efficiency for borrowers when using wBTC and cbBTC is a good idea, and with the increasing prominence of cbBTC as a player in the centralised BTC game, is a smart move. Both risk service providers are in favour of this proposal as well. 5.2% of loans backed by cbBTC are borrowing wBTC to leverage BTC exposure, which could increase in eMode with relatively lower risk. Therefore, we will vote YES in favour of this proposal.